SINGAPORE - Explosives maker Fabchem China has been rocked by a net loss of 57.5 million yuan (S$11.5 million).
The mainboard-listed had posted a profit of 31.5 million yuan last year.
Revenue for the year ended March 31 fell by 19.6 per cent to 393 million yuan.
What hurt the bottomline the most was a 60 million yuan impairment loss on plant and equipment related to its ammonium nitrate business.
The dip in revenue was mainly attributed to the lower sales posted by all its product segments except for industrial detonators, which registered a growth of 6.8 per cent.
Sales in China, its main market, decreased by some 74.7 million yuan or 21.2 per cent, mainly due to fall in sales of ammonium nitrate by 35.1 per cent, decrease in sales of explosives devices by 53.8 per cent and decrease in sales of industrial fuse and initiating devices by 13.5 per cent.
"Notably, the market-driven selling prices of explosive-grade ammonium nitrate continued to experience downward pressure amid weak market conditions, which significantly impacted our ammonium nitrate selling price and quantity," said Fabchem, which noted that the situation was exacerbated by the loss of sales following an unrelated explosions accident in the middle of 2013.
In the aftermath, there were heightened safety checks and controls by the authorities. Loss per share amounted to 24.59 fen, reversing from earnings of 13.46 fen previously.
Net asset value per share shrank by 28.47 fen to 168.28 fen.
In the light of the weak market conditions for ammonium nitrate, the group has projected that this business will continue to incur operating losses this year.
The company proposed a dividend of 0.2 cent a share, down from 0.7 cent last year.